Bloggerwave Inc.(fka BLGW)

[downsideup]

Took a quick look at the accounting, not yet with a purpose focused on parsing things in the numbers, but with one on parsing possible issues with their number crunchers. There clearly have to be issues there, given what you see in the revisions they're having to make, so, need to look at that and see what's there now.

They list TWO accounting firms... one of which clear is a problem, and one of which seems it is not.

I took the info from the 8K
http://www.sec.gov/Archives/edgar/data/1446727/000107878210002416/blogger8k102710.htm

That says: "June 30, 2010...

"Our chief executive officer and chief financial officer, under authority granted to them by the Board of Directors, discussed all of the foregoing and reviewed it with Davis Accounting Group P.C. and M&K CPAS, PLLC, our independent registered public accounting firms for the periods mentioned above."

A search for the Davis firm brings up this PCOAB missive:

http://pcaobus.org/Inspections/Reports/Documents/2009_Davis_Expanded.pdf

I didn't work at it too hard, but the website I found for these guys was an obvious dead end... as in, just not there any more ?

A search for M&K CPAS, PLLC gives you this from the PCOAB:

http://pcaobus.org/Inspections/Reports/Documents/2009_M_K_CPAS.pdf

"This review did not identify any audit performance issues that, in the inspection team's view, resulted in the Firm failing to obtain sufficient competent evidential matter to support its opinion on the issuer's financial statements."

I called their audit group at [phone] and they confirmed for me that BLGW are in fact currently their clients.

There are two patterns apparent in the filings... One clearly shows they appear to be having some fairly significant "issues" with transitioning from what they started with and what they did with it in Europe, to what they have a need to do here. The other is that they do seem to be making a proper corrective effort to get that transition done, and don't seem to be dragging their heels in the effort. Since filing the NT10-Q in November, and announcing non-reliance on prior filings, they've put out 7 amended filings, all within the month.

The filings include a history showing they've fired a couple of "advisors" and retracted and/or canceled their compensation... they also appear to have gotten shed a non-performing accountant.

They've made some changes to the board, also, apparently seeking to make adjustments to better meet their needs... but didn't do that properly, either, in terms of notifying the shareholders before doing it...

Looks like a pretty steep learning curve... but, it doesn't look like they're inflexible, doesn't look like they've been screwing up on purpose, and it doesn't look like problems aren't getting fixed promptly...

Instead, there appears to be a bit of a "ready, fire, aim" issue... and a fairly aggressive bit of follow up happening, to try to deal with fallout resulting from mistakes.

They clearly have needed some help from and could clearly use a steadying influence from some more seasoned advisors, who aren't out of their depth in a public company...

They appear to be making the necessary adjustments...

They obviously need to manage better, get things settled down soon, and get a proper decision making process in place, that will have them making better decisions the first time...

If they can re-allocate most of the energy we see here that is being applied to fixing problems that didn't need to be problems... and instead of using all that energy to address the correction of problems, they apply it to things that matter more in the competition in the space they occupy... ?

I think the business model is interesting enough... and it is a very good thing they have the history of successes they've had in Europe as background...

I think the management is obviously raw, but they seem talented enough, if also obviously inexperienced...

I don't see any obvious evidence that they are ethically challenged... which would be an obvious show stopper for me...

I think this is one that is worth a look. If they ARE able to get through this bit of external noise and be stronger for it once they get things settled down, and then can make some noise of their own in the market, this could prove to be quite a find.

So, I'll be taking some time to do a serious job of doing the DD on this one...